Tesla's Profit Drops 43% as Musk Starts Building Robots and Plans to Sell Driverless Cabs

Tesla’s profit fell 43% last quarter to $787 million, down from $1.37 billion a year earlier, per its quarterly filing. The carmaker poured money into humanoid robots and driverless taxis while delivering about 2% fewer cars.

Revenue stayed flat at $28.05 billion, but operating profit, which is what’s left after the costs of running the business, fell 56% to $718 million. Research spending rose 69% to $2.76 billion, and capital expenditures, the money spent on factories and equipment, more than doubled to $4.73 billion.

That spending targets two products headed for factory floors and city streets. Optimus is a humanoid robot meant to take over dangerous and repetitive jobs, and the Cybercab is a two-seat robotaxi (a self-driving taxi you summon from an app) with no steering wheel or pedals.

Tesla said Wednesday that Optimus has entered production, and an executive said on the earnings call that the company is trying to get Cybercabs to customers by the end of the year.

Optimus is now coming off a production line at Tesla’s Fremont, California, factory. “The bots coming off this line are the first production-quality bots that we have manufactured,” Tesla wrote in its shareholder letter.

Musk wants to reach 20,000 Optimus units a week, but said getting there will take at least a year because the design is still changing. He put deliveries to outside customers around the end of 2027 and called the robot’s hand the hardest hardware problem, along with whether it holds up beyond a month of use.

Tesla has missed Optimus targets before, including a goal of about 10,000 robots in 2025, and rivals are already in the race. Figure AI, a startup backed by Microsoft, OpenAI and Nvidia, unveiled its Figure 02 humanoid in 2024.

On the Cybercab, Lars Moravy, Tesla’s vice president of vehicle engineering, said on the earnings call that they may be available this year: “We’re trying to get Cybercabs to customers by the end of this year, 2026.” Every Cybercab built so far is headed to Tesla’s own robotaxi fleet, and Musk said most will stay Tesla-owned and offered as “transport as a service.”

Tesla has not said who will buy Cybercabs first, though it posted a form last month for people interested in buying robotaxis, and it has not announced a price. The target price Tesla has cited is under $30,000.

Musk said the robotaxi business should become noticeable in Tesla’s overall financials in the second quarter of 2027 and will “probably” be “a big deal by Q3 or Q4 of next year.” Tesla has not disclosed how much money the service brings in.

Musk also said Tuesday, on SpaceX’s earnings call, that the Tesla and SpaceX boards have each formed special committees of independent directors to study a combination, and no terms have been agreed.

A deal needs support from holders of 50% of all outstanding Tesla shares, a hurdle Musk called “quite a high hurdle,” and Tesla’s annual shareholder meeting is December 3, though no merger vote is on the agenda.